Investor demand for the transaction, DKN 2015-1, allowed the issuer to upsize the transaction to $2.6 billion from $2.4 billion. The class A-2-II notes, structured with a weighted average life of 6.8 years, priced at swaps plus 225 basis points.
Avis upsized the deal offering by $50 million and priced the triple-A rated notes at a spread of swaps plus 95 basis points.
The trust is backed by receivables from a portfolio of 1,500 manufacturers, 25,000 dealers and 13 separate product lines.
While larger lessors such as Aercap and GE Capital Aviation Services have generally found funding via general corporate obligations to be more attractive, securitization has become an important source of capital for some smaller firms that would have difficulty tapping the high yield bond market.
An economy on the rebound and greater regulatory clarity are two leading catalysts. Another is the prospect of rising interest rates, which should make it more attractive to issue short-term debt to fund longer-term assets, such as consumer loans and other kinds of debt that will eventually be securitized.
A two-year extension to the deadline for banks to conform CLO holdings to the Volcker Rule doesn't apply to all, the Federal Reserve says.
Despite regulatory hurdles, participants see nothing in the way of issuance reaching $60 billion to $70 billion this year.
Finke says the industry needs to address the lack of understanding about its performance and role in the economy.
Two academics argue that aggreggating standardized assets is key to solar securitization, which can meaningfully reduce funding costs for developers.
Despite pressure from Capitol Hill, regulators are disinclined to allow banks to hold collateralized loan obligations backed by bonds.
Vice President of Regulatory Compliance
Firm: Clayton Holdings
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The $300 billion of CMBS maturing over the next three years will test the recovery of the capital markets.Current Issue